On the Importance of Taiwan

At about 12:36 in the video below, Taiwan is described as "the most important country in the world".

(Yes, 'country'. But I'm not John Cena - see below - and I don't have a movie to promote in China, so I'm not apologising.) 

Anyway, the earlier part of the video covers China's efforts to become a chip superpower.

It failed.

At about 5:52 in the video, the Wassenaar Arrangement of 1996 was described. The video suggest that this effectively blocks China's ability to buy or copy their way into semi-conductor dominance. However, the video may be overstating the case.

In any case, modern chip manufacture today is a complex, multi-national coopoerative effort. At about 9:55, the video explains how the Chinese leadership, not understanding the industry, was defrauded in a series of scams, frauds, and false promises.

China's leadership has not understood that the chip industry is a globalised industry and no one country can "own" the industry.

Although the United States is home to a majority of the world’s leading semiconductor firms, no country has true independence in the semiconductor value chain. The United States depends on critical foreign inputs and manufacturing capacity in the rest of the world. The manufacturing chain for any given semiconductor is extraordinarily complex and relies on as many as 300 different inputs, including raw wafers, commodity chemicals, specialty chemicals, and bulk gases; all are processed and analyzed by upwards of 50 different types of processing and testing tools. Those tools and materials are sourced from around the world, and are typically highly engineered. Further, most of the equipment used in semiconductor manufacturing, such as lithography and metrology machines, rely on complex supply chains that are also highly optimized, and incorporate hundreds of different companies delivering modules, lasers, mechatronics, control chips, optics, power supplies, and more. The “installed base” within a semiconductor factory today represents the cumulation of hundreds of thousands of person-years of R&D development. The manufacturing process that integrates them into a single manufacturing chain could represent hundreds of thousands more.

The semi-conductor chip exists because the world is working together. Each contributor to the final chip owns some cutting edge technology that is essential to the functioning (or even existence) of the chip.

This means that even if China invades and conquers Taiwan, and manages to seize TSMC intact, they may not be able to produce the high-end chips without the ongoing cooperation of the suppliers. And there may be no further development of chips as this would require creativity and talent which cannot be coerced.

China would in effect have killed the goose that lays the golden egg (chips).

But that's assuming China understands that seizing the goose would in effect kill the goose. That is a subtlety that might escape China's ability to comprehend.

Here is an alternative opinion.

I don't think the analysis is very insightful, but I leave it to you to weigh it.

[To be fair, the main video is rather pro-Taiwan, and anti-China, so do keep in mind the biases.]

This video seems more balanced.

The conclusion is that it would not be a good world if US and China goes their own way and all the other nations are forced to line up behind one or the other.

It would be better, if US and China understands that Chips are the symbol of the globalised world, and competition or a tech cold war mentality is old school and has no place in the new world.